If you’re buying a home in England for the first time, it is worth reading this article which discusses about a scheme called ‘first home scheme for first-time buyers’. Per the scheme, you can get discount of 30% to 50% in the market value of the property.
A first-time buyer is the one who does not own any other property in his name.
You can buy a home either from the developer or an individual (who initially bought under the same scheme).
Eligibility for First Home Scheme For First Time Buyers
You must be:
- 18 or older
- a first-time buyer
- able to get a mortgage for at least half the price of the home
- buying the home as part of a household where total income is no more than £80,000 (or £90,000 if you live in London)
- eligible for the scheme as per the council’s regulation (council regulation does not bind you if you are a member of armed forces or their family)
How First Home Scheme Works
The developers (or agent) can find home for you and help you apply for the first homes scheme. A valuation by independent surveyor ensures you get discount on actual market value.
You can get the scheme only for the houses costing lesser than £250,000 after discount (for home in London), and lesser than £420,000 (for home outside London).
The local council will check your eligibility and notify you. After getting approval, you can proceed with your conveyancer who will coordinate with your council and guide for further process.
Stamp Duty Land tax payable while buying
The amount of Stamp Duty Land Tax you pay for a First Home is based on how much you paid for the home after the discount was applied. If you meet conditions for first time buyer’s relief, you may not need to pay SDLT at all.
Restrictions on selling and letting
You can only sell the property to someone who is first time buyer and is eligible for the scheme. You must provide the same percentage of discount as your received under first home scheme.
You can usually only let your First Home for a total of 2 years during your ownership, regardless of number of tenants. But make sure your mortgage statement allows it and local council is informed.
In exceptional circumstances, you can let for more than 2 years. But you can let out a room as long as you live there, and you don’t own other homes.
You can visit HMRC for more information on first home scheme.
Additionally, if you are first time home buyer in UK and looking to avoid hefty Stamp Duty bills. Fill out our First Time Buyers Relief Assessment Form and Get Peace of Mind.
